Vinay’s proven money saving tips
Saving is important. We all work hard for our money so it’s good to have some left over at the end of each pay to invest, buy a house, go on that long-awaited holiday or to have some stashed away for that “just in case” moment. It can be hard to know where to begin though and that’s where I can help. I’ve put together a list of my proven money saving tips to help you get started.
Unsubscribe from all marketing emails. You know those daily emails offering one-off deals, cheap airfares, and discount vouchers? Get rid of them to see your impulse purchases plummet.
KEEP IT SIMPLE
Credit cards can be spending traps. Keep only one credit card and make sure you get rewarded for your spending. Rewards can be redeemable points, cash-back or air-miles. Don’t keep a credit card unless you get something back for it.
NAME IT, SAVE IT
Open up multiple savings accounts and name them after what you’re saving for. For a while there I had “motorbike”, “Europe trip” and “house” accounts. Knowing what you’re saving for can be a fantastic motivator. Most banks will let you open fee-free savings accounts online too so there’s no downside.
Take out your spending money in cash. We’ve all accidentally overspent because we were using paywave or a credit card. Having real money in your wallet makes you realise exactly how much you’re spending.
PAY AS YOU GO
Stagger your big expenses into manageable regular payments. Do you know you can pay a small amount of your rates bill via direct debit each time you get paid? At the end of each year it’s all sorted and you hardly even noticed it going out of your bank account....beauty!
Set up automatic payments for savings and regular bills. If it’s out of sight, it’s out of mind and you’re less likely to spend it. You get the added bonus too of getting prompt payment discounts on things like your power bill.
SLICE AND DICE
Prepare a budget and work out how much you need to slice and dice as soon as you’re paid. Put another way this is the amount that you need to allocate to savings and each of your expenses. Be realistic - the great thing about this exercise is whatever is left over is yours to spend on whatever you want.
Talk to your other half about your savings plan and make sure you’re both on the same page. You can use a little healthy competition and encouragement to work together towards the end goal.
QUESTION THE STATUS QUO
What’s your current living situation? If you live in the house you own work out whether it’s cheaper to rent somewhere else or stay in your home. Compare like for like - what would an interest-only mortgage payment plus rates and maintenance be vs. renting a similar property? Could you live closer to your workplace and pay slightly more in rent but save a lot on transport? Should you get a flatmate or Airbnb that spare room?
FLOAT AND FIX
If you have a mortgage, put a large chunk of it on a low fixed interest rate. Keep a small chunk of it separate on a floating rate which you can pay off (in the same term as you fixed the large part of the mortgage). You won’t notice it, but by the end, you would have paid off that smaller chunk. When you refix, split off another chunk and nail that. Done properly, this can save you a lot in interest over the life of your mortgage.
Never pay full price for clothing or electronics. This works wonderfully in two ways. Firstly, it eliminates a lot of impulse buying at malls, markets and online stores. Secondly, anything you do buy feels like a “good deal”.
SEEK THE BEST USE FOR YOUR MONEY
Whenever you’re buying something non-essential, ask yourself how this money can be used better. If you’re saving for a house remember that every dollar saved is $4 the bank will lend you to buy! Or if you’re a travel bunny think how much better your daily latte will taste in San Francisco...
HAVE SOME FUN
Saving can be a slog. Even though the payoff is awesome the journey can be challenging. It’s important that when you achieve your goals that you don’t move the goalposts. Celebrate your success - go on, you’ve earnt it!